Apple share price took a hit after the investment banking firm Barclays Capital downgraded rating of its shares from ‘oveweight’ to ‘equal weight’ and advised to investors to ‘step aside’ while maintaining a ‘neutral’ stance on the future outlook of the company.
In its report Barclays says that Apple share price will not be able to break the present range in which it has been trading during the next year. It also said that it was likely another Microsoft in the making as far as share price is concerned.
While going into the reasons for this, its Analyst Ben A. Reitzes has said that due to the fastly maturing smartphone market, the growth potential for iPhone was not exceptional in near future. He went on to say that if Apple does not come up with a revolutionary product anytime soon, he does not foresee Apple share price going for a sky-ride anytime soon. He said:
“We believe Apple’s story is all about iPhones and ‘new categories’ seem to be designed to make the iPhone more useful — but don’t necessarily reaccelerate growth in the iPhone category to sustainable double-digit levels. If we were to see evidence that payments and/or new content deals enhance the Web services aspect of Apple vs. Google and others long-term, we may need to reassess this opinion.”
He also said that there was no precedent that a tech company was able to outperform once it had seen a few tough years.
Barclays has recommended the target price of Apple share as $570 which is $35 higher than its current trading price.